IT huge Atos faces collapse if restructuring talks fail

French IT huge Atos is facing monetary complications that will maintain an affect on the skill of its UK arm to state key authorities contracts, including those related to NHS records in hospitals

Sebastian Klovig Skelton


Printed: 27 Jun 2024 15: 45

Key authorities abilities dealer Atos is facing “field matter uncertainty” over its skill to continue trading, auditors maintain warned within the wake of a $5bn debt revelation.   

Within the most recent accounts for the British arm of French IT firm Atos, auditors from Grant Thornton talked about the monetary complications facing its guardian firm would possibly perhaps per chance per chance perhaps restrict its skill to receive entry to cash and “continue as a going teach” if its refinancing efforts plunge by.

As one of UK authorities’s 40 strategic suppliers, which prolong billions of kilos value of contracts between them, Atos offers IT systems to a range of authorities departments and public bodies, including the Dwelling Space of job, the Department for Work and Pensions, and the NHS.

In response to knowledge cleansing startup Tussell, Atos holds 43 engrossing authorities contracts amounting to nearly £1bn of earnings. This involves for work related to disability reduction assessments, managing NHS appointments and sanatorium records, diverse file sharing systems, and instrument making an strive out.

While the broader Atos Team has been undergoing alternate transformation workout routines since June 2022, taking steps to divest itself of non-core alternate devices, it announced in April 2024 that it used to be taking a glimpse at monetary restructuring gives to stabilise its funds, after revealing it has a total debt of nearly $5bn.

The auditors renowned that Atos “can’t rule out that the dwell results of those discussions would possibly perhaps per chance per chance per chance be unsuccessful or that the alternate solutions bobbing up from those discussions point to insufficient to quilt the neighborhood’s financing maturities and cash requirements on a long-term basis,” including that the teach casts “most important doubt” on the firm’s future.

In its 2023 results, Atos UK added that if the guardian firm fails to successfully renegotiate its loans or promote its sources, the UK arm would possibly perhaps per chance per chance perhaps dwell up being unable to resolve its agree with liabilities. “Atos will command the market within the waste of the growth of the refinancing discussions with its monetary creditors, its contemplated disposals, as effectively as any ability adjustments in its capital structure bobbing up from a remaining global refinancing agreement, including the issuance of most modern equity, which is ready to likely pause in a dilution of the existing shareholders,” it wrote.

Atos talked about on 26 June that a rescue state led by IT consultancy Onepoint – the firm’s largest shareholder – fell by after it withdrew a proposal that will maintain transformed €2.9bn of Atos’s debt into equity and injected €250m of most modern funds into the struggling firm.

Nonetheless, Atos added that it had restarted talks with Czech billionaire Daniel Křetínsky about a outdated restructuring proposal, and that it has also purchased a revised restructuring opinion from a neighborhood of its bondholders.

An Atos spokesperson talked about: “Atos is for the time being undergoing a monetary restructuring, which is ready to carry out a accurate monetary future globally and within the UK.

“The provision of providers and products to our clients has remained unaffected, and we are able to continue offering excessive-quality providers and products to the UK public and non-public sectors, as now we maintain for over 30 years.”

In response to a document in The i, the Cupboard Space of job has been engaged on contingency plans since February to make a selection out how key contracts would possibly perhaps per chance per chance perhaps additionally be safe if Atos fails to enhance, which involves doubtlessly brining in numerous IT suppliers.

“With the collapse of the most recent refinancing and restructuring talks, even with original traders reported as starting negotiations, Atos’s future looks precarious,” talked about Mark Lewis, a specialist IT outsourcing lawyer at Stephenson Harwood.

“The UK authorities – and other Atos public and non-public sector clients – are, and are obviously valid to be, making contingency plans,” he talked about. “And if clients haven’t but made them, they ought to be, and now. How effective those plans will likely be in execution is serious. It’s a extremely complex paper and operational state to state successfully.”

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